Saved by the pump: A long overdue decrease in gas prices

Photo courtesy of Fox 47 News

Photo courtesy of Fox 47 News

Kaison Holloway, Staff Writer

As South Carolina citizens gazed at the numbers above gas stations across the upstate dropping from $3.05 to $2.90 to $2.65, many were stunned as well as thrilled. 

It is no secret that the majority of people fork out great deals of money on gasoline each week.  Therefore, as prices decrease, happiness increases.     

On November 13, the American Automobile Association (AAA) averaged the national gas price at $2.91.  It also mentioned that some states, such as Tennessee and South Carolina, are averaged at $2.70.  The energy department has predicted that in 2015 the average will be $2.94 a gallon, forty-five cents lower than 2014.  

Harvard economics professor Leonardo Maugeri told the Boston Globe, “There was huge spending underway to develop or redevelop oil fields around the world.”  Maugeri predicted the price dip in 2012 and was right on the money.  

He also stated that the price drop is generally good for global economy.  However, Maugeri added, “Dropping prices could have very, very dangerous effects on countries that are key for world stability -- Saudi Arabia, Iran, and Russia.”  

NGU economics professor Jon Boulet also says that the decrease of gas prices is good for the economy.  “Places that are going to be hurt the most are countries that use oil revenue to finance their governments,” said Boulet.  

“When it goes down [the price of gas] things improve, you can drive and I can drive ... we’re saving money, we can buy other things and that can cause the economy to bounce back.”  He mentioned that when the economy bounces back upward, gas prices will most likely do the same.

Amy Myers Jaffe is the executive director for energy and sustainability at the University of California, Davis.  She told CBS Money Watch, “I think we could see very high gasoline prices again in the next couple years if something went wrong in the Middle East, for example.”

Jaffe did, however, express her optimism to CBS.  She believes that emerging technology involving solar and wind will improve energy resources and go beyond oil to create cheaper, more sustainable and dependable power supplies.  “I think renewable energy, even though the oil industry doesn’t believe it, is going to continue to compete.”    

The fact that costs have dropped at the pump spreads sighs of relief throughout the nation.  However, behind the smiles a question emerges: “How long will this last?”